Owning of property
NRIs that hold property may pay appropriate property tax. If an NRI purchases immovable property in India from a resident, he must deduct TDS at 1% if the sale consideration exceeds Rs 50 lakh. If property is purchased from a non-resident, and if long-term capital gains are applicable, then TDS should be deducted at 20%.
Sale of property
When an NRI sells property, the buyer is liable to deduct TDS @ 20%. In case the property has been sold before 2 years (reduced from the date of purchase) a TDS of 30% shall be applicable. NRIs can claim exemptions under Section 54, Section 54 EC, and Section 54F on long-term capital gains when filing the return.
Property given on rent
Yes property may be given on rent. The rental income which is earned in India by an NRI is taxable with taxes being deducted at the source by the payers of the rent. The tenants need to obtain a TAN number and deduct 31.2% as tax on rental income. They need to provide the NRIs with the certificate for the same. The rent proceeds may be credited to the relevant NRE or NRO accounts.
